What principle dictates the payment of claims when multiple insurance policies cover the same risk?

The principle that dictates the payment of claims when multiple insurance policies cover the same risk is known as the pro-rata liability principle. This principle ensures that each insurer pays a portion of the claim that corresponds to the amount of coverage they provide relative to the total coverage available.

When multiple policies are in place for the same risk, instead of one insurer bearing the entire burden of a claim, the responsibility is divided among the insurers. Each insurer's share is calculated based on the ratio of the coverage limit of their policy to the total coverage limit across all policies. This way, no single insurer is disproportionately affected, and the insured is compensated fairly without the risk of overindemnification.

The other principles are distinct and apply to different situations or contexts in insurance. The aggregate liability principle, for example, deals with the total liability across multiple claims but does not specifically address how payments are shared among different insurers. The shared liability principle could imply various arrangements for sharing risk but is not a formally recognized term in the context of insurance claims payment. The comprehensive liability principle typically pertains to coverage in specific types of liability insurance rather than addressing the allocation of claims among multiple policies.